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Posts Tagged ‘Trumponomics’

Take One – Data Driven U.S. Outlook in 2019 and MHVille

November 23rd, 2018 Comments off

 

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Propaganda works, but facts matter. In this take one on the 2019 outlook, we will focus on facts and evidence.

 

There are talking heads on cable news, in print or digital mainstream news media, who for some months have ‘talked down’ the U.S. economic forecast. Among their false claims is that the economic surge is a “sugar high” following the tax cuts, and that the high is about to play out.

The crash – a recession, they wrongly claim – is just ahead.

But what some call TrumpOnomics is actually American Economics 101. Prior presidents from each major political party, working with Congress, have enacted similar measures to the Tax Cuts and Jobs Act of 2017. The prior performance was good, just as it is this time too.

In the first 2 graphics below, are the latest numbers from the U.S. Treasury Department. After the tax cuts, there was an initial drop in federal revenues, which are part of the historic norm.

 

FedsCollectRecordTaxesOct2018CNSManufacturedHOusingIndustryDailyBusinessNEwsMHpronews

 

Note that now, less than a year after the tax cut went into effect, we already have more federal tax revenue than at any time in the nation’s history.

 

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The Tax Cuts and Jobs Act of 2017, coupled with prudent deregulation, have already produced an economic boom. It is hiking taxes that creates a short term surge in dollars into federal coffers, followed by a dip in government revenues. Why? Because businesses that can, will move to a lower tax state or nation. Capital can be fluid, or to pardon the pun, Capital is Mobile.

The U.S. stock markets have been in flux for reasons that are too detailed for this report, but headlines are among the factors that have always had some measure of influence on investors. False headlines – misleading or ‘fake news’ – can and does move investors and thus the markets.

For example, headlines about Cavco Industries has contributed to a sharp drop in that company’s stock’s value. ICYMI, see that report linked below.

Hedge Fund’s Cavco Move, and More from Inside MHVille

 

The federal deficit is high, but has been since former President George W. Bush (R) helped create a new entitlement in his so-called “compassionate conservatism. ”  The 43rd president for whatever reasons also plunged the nation into Middle Eastern conflicts which are now the longest U.S, overseas foreign wars. Then President Barack H. Obama (D) kept those costly foreign wars going, and while reducing troop commitments in certain zones, the 44th president actually expanded military action into Libya and other nations too.  Poor strategic policy in the Obama years in Iraq helped spawn the rise of ISIS, and the war over the ‘caliphate’ in Syria was on.

Furthermore, Mr. Obama spilled trillions of dollars in red ink, the most of any U.S. President in American history. ObamaCare, various economic stimulus programs, and tax hikes – all led by Democrats – doubled the national debt in only 8 years. These are nonpartisan facts, and are among the reasons this publication is fundamentally not aligned with either major party.

It is entirely possible that if enough talking heads and negative news are accepted or ‘bought into’ by enough business and investment professionals, that the U.S. economy could slip in 2019. The forecast for the final quarter of 2018 may already reflect that potential. But the simple facts are that the initiatives of President Donald J. Trump, under the able advice or experts like former President Reagan official, Larry Kudlow and others, are working.

As the Daily Business News on MHProNews has noted previously, Democratic President John F. Kennedy and Republican President Ronald Reagan, a Republican who was previously a Democrat, each cut taxes during their administrations. In each case, revenue initially dipped, but then surged in their wake.

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The reasons are American Economics 101. The best way to grow the economy is demonstrably to allow a maximum level of economic activity in the hands of individuals and business. There are exceptions to the rule, which includes the harmful economic impact of monopolies on business and the nation.

President Donald J. Trump ordered his cabinet to return to him planned cuts in their respective budgets. That is the other side or the ‘tax and spend’ equation. If a divided Congress cooperates enough, the prior harmful policies in the past 16 years can continue to have necessary adjustments that could continue the natural economic boom that the nation is experiencing.

 

The Takeaways for the U.S. and MHVille

It is absolutely possible that an ongoing flow of negative media, from either or both sides of the left-right media divide, could cause economic confidence among consumers and businesses to fall. That’s not unlike misinformation about manufactured housing being a harmful drag on our industry. In a similar way, repeated misinformation about the federal budget and the economy could in time harm consumer confidence, and thus economic activity.

It is also possible for a Democratic House to throw a monkey-wrench into the gears. Time will tell what happens.

So while there is no knowing with certainty how harm much negative media or politically harmful economic moves in the House may cause the U.S., the normal economic trends would be good from the Trump Administration Tax Cuts and Regulatory Rollbacks. But manipulation in the form of bad news, and bad policies – if widely believed – could spook investors, owners, and consumers.

Finally, the correct moves in local markets by individual manufactured home companies can still produce record growth, given the strong and growing needs for affordable housing. But as UMH President and CEO Sam Landy has said, those marketing efforts going will have to be done by individual businesses. That means, at the local market level(s). Why?

Because the Manufactured Housing Institute (MHI) and Clayton Homes have both demonstrably failed in their efforts on their respective manufactured home industry image related ‘campaigns.’

Clayton Homes “New” Image Campaign, Surprising Facts Behind Have it Made Stigma Attacking Video

 

The race for 2020 in the U.S, is already underway. And sadly, the attempts to manipulate facts by various interest groups has been and will continue to be a strategy deployed against everyday Americans. That’s why a questioning mind, one ground in facts and that seeks the truth over emotionally manipulatable habits, are so crucial in the days ahead.

That’s also why our growing audience of pro-growth industry professionals craves news with analysis that helps cuts through the noise of agenda-driven special interests.

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Propaganda that is often repeated regrettably works, which is why we provide the means for professional readers to follow the facts and evidence here on the Daily Business News on MHProNews, where “We Provide, You Decide.” © You can sign up for our industry leading headlines news at the link below. © ## (News, analysis, and commentary.)

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Related Reports:

Market Woes? No Recession, Says Goldman Sachs, Plus MH Equities Updates

 

Yes, Thankfully There’s Times Manufactured Homes Earn Bipartisan Praise in Washington, D.C. Metro

MH Silver Lining? Residential Construction Report, Oct 2018, per HUD, Census Bureau

Giving Thanks for Manufactured Housing Independents, Applauding “MHIdea!”

 

Economist Noah Smith – Is Making Stuff In America Still Important?

July 24th, 2017 Comments off

NoahSmithBloombergViewAstProfEcnomicsStonyBrookUnivDoesAmericaStillNeedToBuildStuffManufacturedHousingMHProNews410In general, modern-day economists tend to ignore old schools of economic thought,” writes Noah Smith, a Bloomberg View columnist who has served as an associate professor of economics at Stony Brook University.

For example, many economists now love to poke fun at the physiocrats,” asserts Smith. Those economists “believed that only agriculture created national wealth. Their idea, coming on the eve of the Industrial Revolution, was spectacularly ill-timed. Today, with manufacturing and services accounting for the overwhelming majority of every advanced economy, it’s clear that the physiocrats’ thesis was incorrect.”

Information technology,” along with “Human skills and knowledge, networks, brand value, technological secrets and other intangible assets are now of key importance to many of the most lucrative industries,” said Smith.

First of all,” Smith outlines his case, “physical things are more essential to a baseline standard of living. While internet-based leisure activities may be more and more central to middle-class life, the poor still struggle to get things like housing, heating and transportation.”

Here’s where, likely unwittingly, Smith opens the door to points routinely made on MHProNews and MHLivingNews.com.

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The graphic above was not part of Noah Smith’s article, but is presented by MHProNews.com as data points worth noting while considering Smith’s thesis.

Smith continues. “If governments let physical infrastructure like buses and trains decay, the middle classes will still be able to surf the internet in peace, but poor people will struggle to work.”

Meanwhile,” the economist says, “unless governments address the falling productivity of the home-building industry and take steps to provide cheap, plentiful energy to cities, it will be the lower socioeconomic classes that suffer disproportionatelywe should think about the production of the physical goods the poor need most.”

HistoricalLookUSManufacturingSectorDailyBusinessNewsMHProNews

Again, the graphic above was not part of Noah Smith’s article, but is presented by MHProNews.com as data points worth noting while considering Smith’s thesis.

Second, physical goods act as a form of insurance,” Smith said. “Digital goods rely on the infrastructure of the internet, and that infrastructure could failEnsuring a robust physical economy will help make a nation less vulnerable to sudden impoverishment by sabotage of the global digital infrastructure.”

Third, the intangible economy may be running into the wall of urban political economy. Knowledge-based industries require a lot of smart people to be concentrated in cities,” Smith said. “But because local homeowners tend to control local politics, they often oppose building enough housing to accommodate the increasing number of knowledge workers who need to cluster together. When this happens, it’s usually the poor who get pushed out of town to the forgotten fringes of the local economy.”

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Again, the article linked from the image above dovetails with a point that Smith is making, namely, that knowledge based workers are often clustering for housing, but lower income workers are being pushed out.  See an example of lower wage workers in manufactured homes being pushed out in a recent story, linked here.

Fourth, physical goods are a lot easier to export. Though service exports have risen, most trade is still of the material variety. For a country such as the U.S. with a long-standing structural trade deficit,” Smith asserts that “focusing more on the physical economy in the present may be a way to avoid a painful adjustment in the future.”

Examining Commonalities

Among the several points that Smith laid out that find echoes in previous and pending reports published here or on our sister site:

  • references to causes of rising housing prices in cities,
  • the Trump Administration’s call for improving infrastructure,
  • building more durable goods in the U.S.,
  • enhanced economic and national security from building more domestically,
  • the job value of durable good production at home, vs. importing them from abroad.

While some have long questioned the wisdom of shifting our production capacity to previously hostile or still rival nations such as China, Vietnam or others, this administration – and economist Smith – are pointing to the need for producing more in America as benefits to the working class and national economic security.

Nowhere does Smith mention Trumponomics in his column, but what is certain is that there are echoes of it to be found there.


As the president pushes apprenticeships and more Made in America,” Noah’s thoughtful article is worthy of consideration in the national discussion.  In the manufactured, modular and prefab home building sectors, his points may be particularly relevant. ## (News, analysis.)

Recent economically related articles:

Economic Freedom, Millennial Considers Founders Through Lens of Ron Paul, Walter Williams, Milton Freidman

MillenialConsidersEconomicLibertyDailyBusinessNewsResearchReportsDataManufacturedHousingMHProNews-com-

America, Manufactured Housing & Debate Over Minimum Wage$

AmericaManufacturedHousingDebateMinimumWageFightFor$15DailyBusinessNewsMHProNews

(Image credits are as shown above, and when created by third parties, are provided under fair use guidelines.)

SoheylaKovachManufacturedHomeLivingNewsManufacturedHousingIndustryDailyBusinessNewsMHProNews-Submitted by Soheyla Kovach to the Daily Business News on MHProNews.com.

ADP Jobs Report, Headhunters and Trumponomics

July 6th, 2017 Comments off
TrumponomicsCreditEconomistManufacturedHousingIndustryDailyBusinessNewsMHProNews

Trumponomics image credit, The Economist.

ADP’s June 2017 jobs report is out.  Unemployment is at the lowest point in 16 years, states Bloomberg.

The economy added about 179,000 jobs, somewhat less than expected, says Thomson Reuters.

CNBC says that wages are rising, some .3 percent in June.

Coupled with falling fuel prices, that is good news for American workers.  All of those figures should bode well for manufactured housing operations that want to see more in the U.S. qualify for a home.

I was looking for a low [nonfarm payrolls] number of 150,000 because we’re starting to get retail layoffs,” said Diane Swonk, CEO of DS Economics, per CNBC. “The real conundrum is whether we get any wage acceleration. I’m more concerned about that.”

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But shouldn’t Swonk’s “conundrumbe seen as good news, by workers that want and need to earn more? Isn’t it in keeping with the president’s pledge to create more jobs with higher wages?

Ben Herzon, senior economist at Macroeconomic Advisers, expects 168,000 jobs and low unemployment for months.

For the next several months, we have a number like the 168,000 assumed. We haven’t seen much of a change when you look at GDP growth averaged over a couple of quarters. You’re still running at 2 percent,” Herzon said.

The economy is growing at a moderate pace but given the trends of productivity it’s a fast enough pace to keep job growth at a pretty healthy level,” he said. “As far as wages, if you squint you can kind of see an upper trend in wage growth.”

Economists expect to see unemployment remain at a low 4.3 percent. Carpenter said he will be looking for more signs that slack in the labor market is diminishing.

Headhunters…

Economic and jobs growth is spurring a growing demand for recruiters – so called ‘headhunter’ services, says Bloomberg.

Chris Nace — who’s done such work for the past decade — says that after years of searching for business, companies are now constantly approaching his small firm that focuses on hires in the technology sector in New York City.

Demand is the highest I can remember having,” said Nace.

RecruitingServicesAmericanStaffingAssociationBloombergManufacturedHousingIndustryDailyBusinessNewsMHProNews

Nace’s firm’s fees include one-time payments based on a percentage of the recruited worker’s salary. “Companies are telling us they’re willing to pay $25,000 or $30,000 fees for people who are one or two years out of school. That’s fairly atypical.”

The numbers illumine why that’s the case.

There were a reported 1.17 unemployed job seekers for every vacancy in April.  That’s the second-lowest ratio in that data set, going back to the year 2000.

That compares with a post-“Great Recession” peak of 6.65 people per job opening in July 2009.

Revenue for U.S. search-and-placement services rose to $21.9 billion in 2016, almost triple the level in 2009, according to estimates from the American Staffing Association.  Compare that to new manufactured home sales revenue, which is only about 1/4 that size in 2016.

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Trumponomics

The mainstream media reports may not want to tip their hats in the direction of the Oval Office and President Trump’s policies, but a closer look at the factors that are causing this will reveal that Trumponomics are part of the mix.

But tax and healthcare reform are both needed, as the National Federation of Independent Businesses (NFIB) and others have pushed, see that report, linked here. ##

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SoheylaKovachManufacturedHomeLivingNewsManufacturedHousingIndustryDailyBusinessNewsMHProNews-Submitted by Soheyla Kovach to the Daily Business News for MHProNews.com.